SAN FRANCISCO ZOOLOGICAL SOCIETY

Transcription

1 SAN FRANCISCO ZOOLOGICAL SOCIETY FINANCIAL STATEMENTS WITH INDEPENDENT AUDITOR S REPORT YEARS ENDED

2 INDEPENDENT AUDITOR S REPORT Board of Directors San Francisco Zoological Society San Francisco, California We have audited the accompanying statements of financial position of the San Francisco Zoological Society (the Society) as of June 30, 2011 and 2010, and the related statements of activities and of cash flows for the years then ended. These financial statements are the responsibility of the Society s management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the San Francisco Zoological Society as of June 30, 2011 and 2010, and the changes in its net assets and its cash flows for the years then ended, in conformity with accounting principles generally accepted in the United States of America. GILBERT ASSOCIATES, INC. Sacramento, California October 21,

3 STATEMENTS OF FINANCIAL POSITION CURRENT ASSETS: Cash and equivalents $ 3,906,177 $ 3,669,282 Current portion of contributions receivable 340, ,000 Bequests and other receivables 523, ,493 Prepaid expenses 170, ,375 Total current assets 4,941,163 4,805,150 CONTRIBUTIONS RECEIVABLE, Net 598, ,000 CHARITABLE REMAINDER TRUST ASSETS 223, ,638 INVESTMENTS 6,669,053 6,520,967 PROPERTY AND EQUIPMENT, Net 463, ,440 TOTAL ASSETS $ 12,895,392 $ 13,502,195 LIABILITIES AND NET ASSETS CURRENT LIABILITIES: Accounts payable $ 427,370 $ 660,627 Accrued expenses 920, ,010 Deferred revenue 923,750 1,010,923 Liability to beneficiary 364,865 Current portion of long-term debt 227, ,629 Due to the City and County of San Francisco 258, ,559 Total current liabilities 2,757,849 3,694,613 LONG-TERM DEBT, Net 1,441,224 1,668,756 Total liabilities 4,199,073 5,363,369 NET ASSETS: Unrestricted 2,434,234 1,368,926 Temporarily restricted 2,067,191 2,608,006 Permanently restricted 4,194,894 4,161,894 Total net assets 8,696,319 8,138,826 TOTAL LIABILITIES AND NET ASSETS $ 12,895,392 $ 13,502,195 The accompanying notes are an integral part of these financial statements. 2

4 STATEMENTS OF ACTIVITIES (Page 1 of 2) YEARS ENDED UNRESTRICTED NET ASSETS: REVENUES AND SUPPORT: Program revenues: Admissions $ 4,778,477 $ 4,955,304 Membership dues 1,983,971 1,842,621 Retail commissions 1,004, ,633 Retail sales, rides and rentals 920, ,383 Fundraising and ticketed events (net of direct benefit to donors of $289,690 in 2011 and $332,359 in 2010) 761, ,342 Parking 715, ,651 Education 509, ,023 Children's Zoo 49,983 55,336 Total program revenue 10,724,907 10,442,293 Other support: Management fee 4,120,000 4,120,000 Contributions and bequests 1,511,931 1,639,502 Other income 17,065 21,770 Capital expenditure reimbursements from the City and County of San Francisco 769,650 Satisfaction of restrictions, operations 878, ,425 Total revenues and support 17,252,425 17,263,640 OPERATING EXPENSES: Program services: Animals, collections and exhibits 8,792,634 8,768,045 Children's Zoo 1,007,678 1,007,163 Education 913, ,185 Retail operations 748, ,823 Membership services 542, ,069 Admissions and other program expenses 1,082, ,935 Total program services 13,087,794 12,876,220 Supporting services: General and administrative 1,375,781 1,347,084 Marketing 1,149,421 1,275,576 Fundraising 556, ,047 Total supporting services 3,081,423 3,252,707 Total operating expenses 16,169,217 16,128,927 INCOME FROM OPERATIONS $ 1,083,208 $ 1,134,713 The accompanying notes are an integral part of these financial statements. 3

5 STATEMENTS OF ACTIVITIES (Page 2 of 2) YEARS ENDED UNRESTRICTED NET ASSETS (CONTINUED): Investment income 90, ,383 Depreciation expense (108,288) (95,773) Capital expenditures to be gifted to the City and County of San Francisco (417,926) (448,180) Other capital expenditures (255,118) (7,733) Satisfaction of restrictions, capital 673, ,913 INCREASE IN UNRESTRICTED NET ASSETS 1,065,308 1,830,323 TEMPORARILY RESTRICTED NET ASSETS: Contributions 567,495 1,551,927 Investment income 25,680 47,624 Change in value of charitable remainder trust assets 445,576 29,129 Satisfaction of restrictions, operations (878,522) (270,425) Satisfaction of restrictions, capital (673,044) (455,913) Donor redirection of funds (28,000) INCREASE (DECREASE) IN TEMPORARILY RESTRICTED NET ASSETS (540,815) 902,342 PERMANENTLY RESTRICTED NET ASSETS: Contributions 5,000 6,000 Donor redirection of funds 28,000 INCREASE IN PERMANENTLY RESTRICTED NET ASSETS 33,000 6,000 INCREASE IN NET ASSETS 557,493 2,738,665 NET ASSETS, Beginning of Year 8,138,826 5,400,161 NET ASSETS, End of Year $ 8,696,319 $ 8,138,826 The accompanying notes are an integral part of these financial statements. 4

6 STATEMENTS OF CASH FLOWS YEARS ENDED CASH FLOWS FROM OPERATING ACTIVITIES: Increase in net assets $ 557,493 $ 2,738,665 Reconciliation to net cash and equivalents provided by operating activities: Depreciation 108,288 95,773 Net realized and unrealized gain on investments (46,576) (715,915) Permanently restricted contributions (5,000) (6,000) Donated property and equipment (6,561) Accrued interest on long-term debt 23,801 Loss on capital lease disposal 1,629 Changes in: Bequests and other receivables 43, ,389 Prepaid expenses 52,519 (20,279) Contributions receivable 191,661 (942,043) Charitable remainder trust assets 624,407 20,907 Accounts payable (233,257) 293,346 Accrued expenses 42,604 11,581 Deferred revenue (87,173) 34,351 Liability to beneficiary (364,865) (50,036) Due to the City and County of San Francisco (296,977) 555,559 Net cash and equivalents provided by operating activities 588,455 2,471,538 CASH FLOWS FROM INVESTING ACTIVITIES: Purchases of investments (501,510) (10,338,991) Proceeds from sale of investments 400,000 10,211,156 Purchases of property and equipment (30,422) (414,568) Net cash and equivalents used by investing activities (131,932) (542,403) CASH FLOWS FROM FINANCING ACTIVITIES: Permanently restricted contributions 5,000 6,000 Repayment on long-term debt (224,628) (250,000) Repayment on line of credit (600,000) Net cash and equivalents used by financing activities (219,628) (844,000) NET INCREASE IN CASH AND EQUIVALENTS 236,895 1,085,135 CASH AND EQUIVALENTS, Beginning of Year 3,669,282 2,584,147 CASH AND EQUIVALENTS, End of Year $ 3,906,177 $ 3,669,282 SUPPLEMENTAL ACTIVITY: Cash paid for interest $ 25,157 $ 31,897 The accompanying notes are an integral part of these financial statements. 5

7 1. ORGANIZATION AND OPERATIONS The San Francisco Zoological Society (the Society) is a nonprofit public benefit corporation organized in 1954 for charitable, scientific, and educational purposes for the study and promotion of zoology and wildlife conservation and for the education and recreation of the public. The Society currently provides a wide range of services for the City and County of San Francisco (the City) at the San Francisco Zoological Gardens (the Zoo). The Society and the City have negotiated a management agreement, which incorporates animal care, management of all facilities, operations, community support, and public services. 2. SIGNIFICANT ACCOUNTING POLICIES Basis of accounting and financial statement presentation The financial statements are prepared on the accrual basis of accounting and in conformity with professional standards applicable to not-for-profit entities. The Society reports information regarding its financial position and activities according to three classes of net assets: unrestricted, temporarily restricted, and permanently restricted. Revenue recognition Contributions and bequests are recognized in full when received or unconditionally promised, in accordance with professional standards. All contributions are considered available for unrestricted use unless specifically restricted by donors for future periods or specific purposes. Donor-restricted amounts are reported as increases in temporarily or permanently restricted net assets. Temporarily restricted net assets become unrestricted, and are reported in the statement of activities as satisfaction of restrictions, when the time restrictions expire or the contributions are used for the restricted purposes. Permanently restricted net assets are those net assets whose use by the Society is restricted by donor-imposed stipulations that neither expire by the passage of time nor can be fulfilled and removed by the actions of the Society and consist of contributions to the Society s endowment fund. Education and special event revenue is recognized when the related event occurs. Membership revenue is recognized over the term of the membership, typically one year. Donated materials, equipment, and professional services are recorded as in-kind donations and recognized at the estimated fair value as of the date of donation or service. Contributed services that do not meet the criteria for recognition are not reflected in the financial statements. Cash and equivalents For financial statement purposes, the Society considers all investments with an initial maturity of three months or less at time of purchase to be cash equivalents. The Society minimizes credit risk associated with cash by periodically evaluating the credit quality of its primary financial institution. The balance at times may exceed federally insured limits. The Society has not experienced any losses in such accounts and management believes the Society is not exposed to any significant credit risk related to cash. Investments are stated at fair value (see Note 7). 6

8 Charitable remainder trust assets include the fair value of the Society s remainder interest in irrevocable trusts for which the Society is the secondary beneficiary. The fair value of the Society s remainder interest in irrevocable trusts is determined using investment returns consistent with the composition of the asset portfolios, life expectancies, and the discount rates of 2.8% and 3.2% at June 30, 2011 and 2010, respectively. Irrevocable charitable trusts whose use is limited by the Society due to time or donor-imposed restrictions increase temporarily restricted net assets. Liability to beneficiary represents the present value of the liability due to the primary beneficiary of the irrevocable charitable remainder trust for which the Society was both trustee and secondary beneficiary. The liability was eliminated in 2011 as the Society received the final payment from this trust. Property and equipment is stated at cost or, if donated, at the estimated fair market value at the date of donation. The Society capitalizes all expenditures for property and equipment in excess of $1,500. Depreciation is computed using the straight-line method over estimated useful lives of individual assets ranging from 3 to 39 years. Pursuant to the management agreement with the City of San Francisco (Note 13), property and equipment of the Society consists of furniture, furnishings and articles of movable personal property installed in the Zoo, by or for the account of the Society, without expense to the City, and which can be removed without structural or other material damage to the Zoo. The City retains title to all real property and all appurtenances, fixtures, improvements, equipment, additions and other property attached to or installed in the Zoo. Capital expenditures by the Society for property and equipment for which the Society does not retain title are expensed when incurred and are donated to the City as a gift upon completion. Functional expenses The costs of providing the program and supporting services have been summarized on a functional basis in the statements of activities. Certain costs have been allocated to program services based on estimates of employees time incurred and management s estimate of the usage of resources. Income taxes The Society is exempt from income taxes under Section 501(c)(3) of the Internal Revenue Code. The Society has implemented the amended accounting principles related to the accounting for uncertainty in income taxes and has determined there is no material impact on the financial statements. With some exceptions, the Society is no longer subject to U.S. federal and state income tax examinations by tax authorities for Society tax years prior to June 30, Use of estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates. Subsequent events have been reviewed through October 21, 2011, the date the financial statements were issued. 7

9 Recent accounting pronouncements The Financial Accounting Standards Board issued an Accounting Standards Update related to improving disclosures about fair value measurements. The guidance clarifies existing disclosure requirements regarding inputs and valuation techniques, as well as the level of disaggregation for each class of assets and liabilities for which separate fair value measurements should be disclosed. Other than requiring additional disclosures, adoption of this update did not have a material effect on the Society s financial statements. 3. CONTRIBUTIONS RECEIVABLE The Society recognizes contributions receivable at their estimated fair value. Fair value is determined by calculating the present value of the estimated future cash flows. The discount rates used in determining the net present value of contributions receivable ranged from 1.8% to 3.2%. Contributions receivable are due to be collected as follows: Within one year $ 340,339 $ 345,000 In one to five years 598, ,000 Contributions receivable, net $ 938,339 $ 1,130, CONDITIONAL PROMISES TO GIVE In 2011, the Society received a $1,000,000 conditional promise to give from a donor. The Society must raise certain matching funds as a condition of this promise to give. In accordance with professional standards, as of June 30, 2011, no revenue has been recognized related to this promise to give as the conditions of the contribution have not been met. 5. CHARITABLE REMAINDER TRUST ASSETS Charitable remainder trust assets consist of the following: Charitable remainder interests receivable from third parties $ 223,231 $ 197,051 Assets held in charitable remainder trust in which the Society is both trustee and remainder beneficiary 650,587 Total $ 223,231 $ 847,638 8

10 6. INVESTMENTS Investments consist of the following: Cash and equivalents $ 1,802,950 $ 1,901,440 Fixed income mutual fund short-term bond 2,527,898 2,201,845 Fixed income mutual fund ultra-short bond 2,338,205 2,319,062 Fixed income bond 98,620 Total investments $ 6,669,053 $ 6,520,967 Investment income consists of the following: Interest and dividends $ 69,492 $ 123,092 Net realized and unrealized gain 46, ,915 Total investment income $ 116,068 $ 839, FAIR VALUE MEASUREMENTS The Society values its financial assets and liabilities based on the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. In determining fair value, the Society utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible. In order to increase consistency and comparability in fair value measurements, a fair value hierarchy that prioritizes observable and unobservable inputs is used to measure fair value into three broad levels, as follows: Level 1 Inputs Unadjusted quoted prices in active markets that are accessible at the measurement date for identical assets or liabilities. Level 2 Inputs Level 3 Inputs Inputs other than quoted prices in active markets that are observable either directly or indirectly. Unobservable inputs in which there is little or no market data, which require management to develop their own assumptions. 9

11 The Society s assets are classified as follows: Year ending June 30, 2011: Level 1 Level 2 Level 3 Investments $ 6,669,053 Charitable remainder interests receivable from third parties $ 223,231 Total $ 6,669,053 $ $ 223,231 Year ending June 30, 2010: Level 1 Level 2 Level 3 Investments $ 6,422,347 $ 98,620 Investments held in charitable remainder trusts in which the Society is both trustee and remainder beneficiary 650,587 Charitable remainder interests receivable from third parties $ 197,051 Total $ 7,072,934 $ 98,620 $ 197,051 The Society s investments and investments held in charitable remainder trusts in which the Society is both trustee and remainder beneficiary are classified within Level 1 of the fair value hierarchy because they are valued using quoted market prices, broker or dealer quotations, or alternative sources with reasonable levels of price transparency. The Society s fixed income bond investments are classified within Level 2 of the hierarchy because they are valued using alternative pricing methods using observable information inputs. The Society s charitable remainder interests receivable from third parties are classified within Level 3 of the hierarchy because determination of the present value of future cash flows is based on little or no market data and requires management to develop their own assumptions. Changes in the Level 3 charitable remainder interest receivables for the year ending June 30 consist of: July 1 $ 197,051 $ 176,915 Unrealized increase in fair value 26,180 20,136 June 30 $ 223,231 $ 197,051 10

12 8. PROPERTY AND EQUIPMENT Property and equipment consist of the following: Machinery and equipment $ 976,211 $ 1,025,292 Furniture and fixtures 350, ,192 Software 348, ,229 Other 85,951 76,160 Total 1,761,227 1,802,873 Less accumulated depreciation and amortization (1,297,282) (1,259,433) Total $ 463,945 $ 543,440 Management estimates that approximately 51% and 46% of depreciation expense relates to program services and 49% and 54% to supporting services for the years ended June 30, 2011 and 2010, respectively. 9. DONATED MATERIALS AND SERVICES The Society received donated materials and services, which were used for the following activities: Auction items and catering services $ 54,345 $ 171,129 Legal services 30,400 40,400 Marketing services 20,000 50,000 Advertising materials and services 14,630 Other 7,283 7,219 Total donated materials and services $ 112,028 $ 283, NET ASSETS Temporarily restricted net assets are available for the following purposes: Capital program $ 1,486,634 $ 1,131,047 Charitable remainder trust assets time restricted 223, ,773 Conservation 137, ,224 Parrot/lorikeet research 511,178 Other projects 219, ,784 Total $ 2,067,191 $ 2,608,006 11

13 Permanently restricted net assets consist of the following: General operations $ 2,516,282 $ 2,516,282 Conservation 1,000,000 1,000,000 Education 472, ,712 Other projects 205, ,900 Total $ 4,194,894 $ 4,161,894 The Society s endowment consists of approximately nineteen individual donor restricted endowment funds and two board-designated endowment funds for a variety of purposes. The net assets associated with endowment funds including funds designated by the Board of Directors to function as endowments, are classified and reported based on the existence or absence of donor imposed restrictions. The Board of Directors has interpreted the Uniform Prudent Management of Institutional Funds Act (UPMIFA) as requiring the preservation of the original gift as of the gift date of the donor restricted endowment funds absent explicit donor stipulations to the contrary. As a result of this interpretation, the Society classifies as permanently restricted net assets, (a) the original value of gifts donated to the permanent endowment, (b) the original value of subsequent gifts to the permanent endowment, and (c) accumulations to the permanent endowment made in accordance with the direction of the applicable donor gift instrument at the time the accumulation is added to the fund. The remaining portion of the donor restricted endowment fund that is not classified in permanently restricted net assets is classified as temporarily restricted net assets until those amounts are appropriated for expenditure of the Society in a manner consistent with the standard of prudence prescribed by UPMIFA. In accordance with UPMIFA, the Society considers the following factors in making a determination to appropriate or accumulate endowment funds: 1) The duration and preservation of the fund 2) The purposes of the Society and the donor-restricted endowment fund 3) General economic conditions 4) The possible effect of inflation and deflation 5) The expected total return from income and the appreciation of investments 6) Other resources of the Society 7) The investment policies of the Society 12

14 The Society had the following endowment activities during the years ended June 30, 2011 and 2010: Year ending June 30, 2011: Board Designated Unrestricted Permanently Restricted Endowment net assets, beginning of year $ 2,359,073 $ 4,161,894 Investment income, net of fees 68,510 Realized and unrealized gain on investments 46,576 Donor redirection of funds 28,000 Contributions 5,000 Endowment net assets, end of year $ 2,474,159 $ 4,194,894 Year ending June 30, 2010: Board Designated Unrestricted Permanently Restricted Endowment net assets, beginning of year $ 1,521,323 $ 4,155,894 Investment income, net of fees 121,835 Realized and unrealized gain on investments 715,915 Contributions 6,000 Endowment net assets, end of year $ 2,359,073 $ 4,161,894 From time to time, the fair value of assets associated with individual donor-restricted endowment funds may fall below the value of the initial and subsequent donor gift amounts (deficit). When donor endowment deficits exist, they are classified as a reduction of unrestricted net assets. These deficits resulted from unfavorable market fluctuations and authorized appropriation that was deemed prudent. The Society has adopted endowment investment policies that attempt to provide a predictable stream of funding to programs supported by its endowment while seeking to maintain the purchasing power of endowment assets. Under this policy, the return objective for the endowment assets, measured over a full market cycle, shall be to maximize the return against a blended index, based on the endowment s target allocation applied to the appropriate individual benchmarks. To achieve its long-term rate of return objectives, the Society relies on a total return strategy in which investment returns are achieved through both capital appreciation (realized and unrealized gains) and current yield (interest and dividends). The Society targets a diversified asset allocation that places greater emphasis on fixed income investments to achieve its long-term objectives within prudent risk constraints. 13

15 The Board of Directors of the Society determines the method to be used to appropriate boarddesignated endowment funds for expenditure. Calculations are performed for individual endowment funds at a rate of 5% of the average last three years ending endowment fund balance. The corresponding calculated spending allocations are distributed in the second quarter from the current net total or accumulated net total investment returns for individual endowment funds. In establishing this policy, the Board or Directors considered the expected long term rate of return on its endowment. Accordingly, over the long term, the Society expects the current spending policy to allow its endowment to grow at an average of 4% annually, consistent with its intention to maintain the purchasing power of the endowment assets as well as to provide additional real growth through new gifts. 11. LONG-TERM DEBT Long-term debt consists of the following: Payable to the City, principal payment of $250,000 paid on October 1, 2009, monthly payments of $8,442 beginning July 2010, including principal and interest of 3.75% per annum, unpaid principal and interest due August $ 629,384 $ 705,531 Payable to the San Francisco Public Utilities Commission, with 0% interest if scheduled payments are made as agreed and 5% per annum if scheduled payments are not made as agreed; principal payments of $148,481 due annually beginning July 31, 2010, until maturity at July 31, ,039,373 1,187,854 Total 1,668,757 1,893,385 Less current portion (227,533) (224,629) Long-term debt, net $ 1,441,224 $ 1,668,756 Scheduled annual maturities of long-term debt are as follows: Year ending June 30: 2012 $ 227, , , , ,305 Thereafter 499,759 Total $ 1,668,757 14

16 12. PENSION PLAN The Society has a defined contribution plan covering all full-time employees not covered by a collective bargaining agreement. The plan calls for contributions of five percent of covered salaries and is funded by the purchase of insurance annuity contracts. Total plan costs were $139,820 and $122,852 in June 30, 2011 and 2010, respectively. 13. CITY AND COUNTY OF SAN FRANCISCO San Francisco Zoo management agreement The Society has negotiated a management agreement (the Agreement) with the City, acting through its Recreation and Park Commission, which was approved by the Board of Supervisors on September 7, 1993 and effective on October 9, The Agreement originally expired on June 30, 1998, and provides for additional automatic extensions for successive periods of five years, not to exceed ninety-nine years. The next automatic extension of the Agreement is in Generally, under the Agreement, the Society receives an annual management fee from the City plus all admission fees, and in turn, is responsible for all operating and maintenance expenses incurred in the operation of the Zoo. The management fee under the contract s current extension period is $4,120,000 per year and will be adjusted upon each subsequent extension based upon the terms in the Agreement. Operating expenses incurred by the City and paid by the Society for the years ended June 30, 2011 and 2010, were $1,393,398 and $1,655,703, respectively. Animal purchase and exchange fund In accordance with the Agreement, all amounts held by the City in the animal purchase and exchange fund, which was established pursuant to Section of the City s Administrative Code, are appropriated to the Society for the purpose of animal purchases at the Zoo annually. In addition, all proceeds from sale or other disposition of animals are deposited into the City s animal purchase and exchange fund or other segregated fund established by the Society. All funds transferred by the City and animal sales proceeds held in the segregated fund established by the Society are to be held in trust by the Society for the benefit of the City, and are restricted to animal purchases. For the years ended June 30, 2011 and 2010, no funds were transferred by the City to the Society. Purchases of animals in excess of the balance in this fund are paid for and expensed by the Society. Total purchases amounted to $2,309 and $13,800 for the years ended June 30, 2011 and 2010, respectively. The balance in the annual purchase and exchange fund was $76,059 and $73,368 at June 30, 2011 and 2010, respectively. General obligation bonds A general obligation bond measure to fund $48 million towards Zoo improvements was passed in June Series 1999C Bonds were issued in June 1999, Series 2000B Bonds were issued in June of 2000, Series 2002A Bonds were issued in September of 2002, and Series 2005H Bonds were issued in June All bonds mature twenty years from issuance. 15

17 Proceeds from these bonds are available for, but are not limited to, funding the acquisition, construction and/or reconstruction of San Francisco Zoo facilities and properties and all other works, property and structures necessary or convenient for these purposes, and to pay for certain costs related to the issuance of the Series 1999C Bonds, Series 2000B Bonds, Series 2002A Bonds, and Series 2005H Bonds. The City and County of San Francisco are responsible for the issuance, the use of the proceeds and the repayment of these bonds for the benefit of the San Francisco Zoo. 14. FOOD, BEVERAGE AND CONCESSIONS AGREEMENT The Society has a concessions agreement with Service Systems Associates, Inc. (SSA) to provide for the operation of food, beverage, gift shop, and rental concessions at the Zoo. SSA has agreed to pay the Society certain percentages of gross receipts based on the various types of concession sales. Retail concession revenues paid to the Zoo totaled $1,004,629 and $985,633 for the years ended June 30, 2011 and 2010, respectively. 16